IBM and IBEC Initiate Broadband Access to 200,000 Rural Americans

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ARMONK, NY and HUNTSVILLE, AL
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18 Feb 2009:
IBM (NYSE: IBM) and International Broadband Electric Communications, Inc. (IBEC) -- an Internet Service Provider -- today announced they have begun to establish Broadband over Power Line (BPL) networks for nearly 200,000 rural customers served by 7 electrical cooperatives in Alabama, Indiana, Michigan and Virginia.

Funded by low-interest Rural Broadband Access Loans from the United States Department of Agriculture Rural Development Program, IBEC aims to bring broadband Internet access to rural communities via existing power line infrastructure. IBM, the first major systems integrator to enter this market, is providing overall technical expertise, project management, and training of the line crews who are installing the BPL technology.

How it works: Broadband over power line technology modifies radio signals to transmit voice and Internet data over electric utility power lines. All a consumer needs is a modem that plugs into existing electrical outlets in their home or business. With no new wires to install, setup is simple and easy. Learn more from Cullman Electric CEO Grady Smith: "Broadband Over Powerlines - Rural America's Key to Tomorrow's Broadband Services."

"In the near-term, IBM and IBEC's effort promises to bring broadband access to the scores of the nearly 45 percent of Americans that do not have it today," said Raymond Blair, Director of Advanced Networks at IBM. "In the long-term, the effort will lead to the expansion of small businesses and creation of new industries, bringing new jobs to rural Americans and driving net new economic growth."

"While DSL and Cable modem service providers are competing head-to-head in many urban areas, neither is feasible in low density, underserved areas (both rural and urban), where DSL requires significant telephone network upgrades, and cable data is not economically viable," said Scott Lee, CEO of IBEC. "The only broadband choice for many consumers in rural areas is satellite data service, which does not offer comparable data rates and is more costly than wire line services."

IBM and IBEC, with the aid of government funding, are building broadband over power line networks in cooperation with member-owned electric utility co-ops across the nation. The first seven co-ops to participate include: Cullman Electric Cooperative in Alabama; Utilities District of Western Indiana REMC, Parke Country REMC and South Central REMC in Indiana; Midwest Energy Cooperative in Michigan; and BARC Electric Cooperative and Central Virginia Electric Cooperative in Virginia. These are just seven of nearly 900 electric cooperatives in the United States providing 45% of the total electric grid and covering 75% of the land mass in the U.S.

Bob Hance, CEO of Midwest Energy Cooperative in Michigan led an effort to survey the Midwest's customers to determine if there was interest in broadband Internet services. Within a week, the cooperative had a waiting list of 4,000 customers practically pleading for service. "We were amazed by the responses to the survey -- thousands of letters from citizens of our community expressing their need for broadband in order to improve everything from childhood education to the future of their family-owned small businesses," said Hance. "We shared nearly 600 of these letters with local legislators after we realized none of the major service providers were going to answer their calls for help. Thanks to the help of those legislators, IBM and IBEC were able to access the resources needed to help our community. In less than two weeks, we've already deployed 400 live miles with broadband access, or nearly 4,000 homes."

Grady Smith, CEO of Cullman Electric Cooperative in Alabama believes BPL technology can do for rural America today what the Rural Electric Administration (REA) did for it in the 1930s. Cullman has 1,600 homes wired for BPL technology thus far, and expects to pass nearly 7,000 homes by the end of February. "Today, instead of electricity, it is broadband service that is on course to change our lives. I do not believe it is an exaggeration to say that broadband service is the single most important technological issue of this generation, and that it will have the greatest impact on society since basic electricity and telephone service."

Bruce King, CEO of BARC Electric Cooperative in Virginia is looking forward to bringing broadband access to his community of 11,000 households and small businesses in the coming months. "I cannot go to church or rotary club meetings on the weekend without someone in the community asking me when we'll have high speed Internet access. Our members are orphans in the Internet world," said King. "I'm proud to be able to tell our members that it will only take us 1 percent of the money we invested in the electric system to begin with to enable it for broadband. I am a financial guy, and that is an overwhelming reason to do it."

About IBEC
IBEC, Inc. is a full-service provider of Broadband over Power Line Internet access products, solutions and services, electric utility SmartGrid communication and integration solutions, and powerline-based security systems. Focused on meeting the broadband needs of rural and underserved America, IBEC is the leading provider of Broadband over Power Line solutions to rural electric utilities and their consumers. For more information, contact IBEC at 285 Dunlop Boulevard SW, Suite K, Huntsville, AL 35824-1103 USA, 256.492.1000, 256.456.1406 fax, or via email at Marketing@ibec.net. On the Internet, visit IBEC at http://www.ibec.net and http://www.bpl.coop. IBEC - EmPOWERing the World's Broadband®